The company is targeting to issue 10 million cards by the end of 2022.
Soon after Paytm's foray into the credit card business, Softbank-backed ride hailing firm Ola has also taken the plunge with the launch of its credit card in partnership with public lender State Bank of India (SBI) on May 15.
With this launch while Ola gets to widen its financial products base, it also offers SBI an opportunity to expand its credit card business with millions of customers Ola has on its platform. The company is targeting to issue 10 million cards by the end of 2022.
Ola currently offers Ola Money wallet, postpaid billing and micro-insurance for rides taken on the Ola platform.
"We are excited to launch the Ola Money SBI Credit Card and we look forward to taking this to millions of Indians over the next few years. Mobility spends form a significant wallet share for users and we see a huge opportunity to transform their payments experience with this solution. With over 150 million digital-first consumers on our platform, Ola will be a catalyst in driving India’s digital economy with cutting edge payment solutions," said Bhavish Aggarwal, co-founder and chief executive officer (CEO) of Ola.
The card will be powered by Visa. Ola users will be able to apply, view and manage their credit cards directly on the Ola app. Card users will also be offered cash-backs from the company, which will be credited to the customer's accounts in the form of Ola Money. These cashbacks can be redeemed against Ola rides, flight and hotel bookings.
The company declined to comment on who will be sponsoring the cashbacks.
“The launch of Ola Money SBI Card underlines our penchant to provide innovative and industry-first payments solutions to our customers. Through this card, we aim to address their evolving mobility spends while providing them with maximum value and unique benefits on their travel spends, especially for cab-based commute. Ola is considered to be a pioneer in the mobility industry and we believe this partnership will play a key role in further strengthening our card portfolio," said Hardayal Prasad, managing director and CEO, SBI Cards.
The spending limit of a customer will be a percentage of the credit limit offered to the customers and will not be a flat amount.India is a highly under-penetrated market for digital payments with just over 10 percent of PCE (Personal Consumption Expenditure) being transacted digitally and Indian digital payments are expected to touch $1 trillion by 2023.